70.2K
Verified Solution
Link Copied!
A Corporation has two service departments, S1 and S2, and three production departments, P1, P2, and P3. Data for a recent month follow:
| Service Provided to: | S1 | | S2 | | P1 | | P2 | P3 | |
| S1 | | | | | | 0.10 | | | | 0.20 | | | | 0.40 | | | 0.30 | |
| S2 | | 0.30 | | | | | | | | 0.20 | | | | 0.40 | | | 0.10 | |
| Costs | $ | 200,000 | | | $ | 100,000 | | | $ | 600,000 | | | $ | 800,000 | | $ | 1,000,000 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
a. Compute the allocation of service department costs to producing departments using the direct method.
b. Compute the allocation of service department costs to producing departments using the step-down method.
c. Compute the allocation of service department costs to producing departments using the reciprocal method.
Answer & Explanation
Solved by verified expert
